Mandarin Oriental Hotel Group is set to go private.
The global hotel brand's controlling shareholder, Hong Kong-based Jardine Matheson, is in the process of acquiring the remaining 11.96% of Mandarin Oriental through its wholly owned subsidiary Bidco, according to a bourse filing. The $3.35-per-share deal gives Mandarin Oriental a new, total valuation of approximately $4.2 billion.
Mandarin Oriental also announced — concurrent to the deal to take it private — that is has agreed to sell the top 13 floors (levels 21 to 35), its rooftop signage and 50 parking spaces of building One Causeway Bay in Hong Kong to two entities, Alibaba Group and Ant Group. That part of the deal — named the OCB Sale — is valued at $925 million.
The $3.35 bid deal to take Mandarin Oriental private includes a $2.75 scheme value and a $0.60 special dividend and represents an approximate 52.3% premium to Mandarin Oriental’s closing price of $2.20 on Sept. 29.
Several directors of Mandarin Oriental are also directors of Jardine Matheson, so to avoid conflicts of interest, the acquisition process is being considered by the Mandarin Oriental Transaction Committee, a committee of independent, non-executive directors of Mandarin Oriental.
Jardine Matheson and its subsidiaries intend to finance the privatization using cash on its balance sheet together with committed facilities, the official statement of the deal said.
The proposal needs to be agreed to by 75% of Mandarin Oriental shareholders, with Jardine Matheson stating it is hopeful it will be able to close the deal by the end of February 2026.
The sale of the 301,555-square-foot section of One Causeway Bay, Mandarin Oriental said in the filing, “is a resounding expression of confidence in Hong Kong’s attractiveness as a global gateway city and the vitality of our local economy. … The sale marks a further advancement in [our] asset-light strategy and will enable a significant return of capital to shareholders.”
Mandarin Oriental has 43 hotels around the world in operation and four set to open soon, including the 138-room Mandarin Oriental, Vienna, on Oct. 28 in an 1908 Art Nouveau building, a heritage-listed former courthouse at Riemergasse 7.
Jardine Matheson has not returned correspondence from CoStar News Hotels by press time.